Global Economics

Europe to Get Smart Meters by 2020


As part of a market liberalization plan, 80% of European households will be outfitted with energy-saving 'smart' utility meters over the next decade

Some 80 percent of European consumers are set to have smart energy meters installed in their homes by 2020 as part of a deal on liberalising the EU's energy market.

The new agreement between the European Parliament and the Czech EU presidency updates proposals put forward by the EU executive in 2007, initially aimed at preventing big electricity and gas supply companies from owning both distribution networks and pipelines – the so-called unbundling policy.

After fierce opposition particularly from Germany and France – home of energy giants Gaz de France (GSZ.PA) and EoN (EONGN.DE ) – the unbundling deal has been diluted by giving member states unbundling options while strengthening the role of national and EU regulators.

The European Parliament also managed to add a provision under which every household is to have "smart meters" allowing them not only to carefully screen and control energy consumption, but also to sell energy back to the network, for instance by installing solar panels on the roof.

"The price of electricity in particular is determined by when the peak hours are," British Labour MEP Eluned Morgan explained to journalists at a press conference. "So if you could take the peak hours out by getting people to use dishwashers or washing machines at night, you would get a more sophisticated way of using electricity. These smart meters can actually speak to the generator and tell it to stop putting up the amount of energy they use."

The EU legislative also introduced a provision to fight "energy poverty" – when gas and electricity bills eat up so much of a user's income they cannot afford other basics.

Consumers will be able to change their energy provider within three weeks after the transposition of the EU agreement into national law, expected by the end of next year.

Gazprom clause strengthened

A "third-country clause" aimed at preventing energy giants or monopolies from countries beyond the EU such as Russian gas supplier Gazprom (GAZP.RTS) from buying energy networks and imposing their price on EU consumers was "re-inforced by the proposal," EU commission spokesman Ferran Tarradellas said at a press briefing.

It will rest under the competence of national regulators, whose independence has now been strengthened, to decide whether a given investment affects EU energy security or not and whether it is in compliance with EU rules.

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